It’s January which usually means new resolutions and many times they can be financial. Sarah and I’s goal when we first got married was to stay completely debt free which I’ve written about before. But the biggest challenge for us, as we had no debt, was to buy a house with cash. I thought it’d be fun to write out a step-by-step process of how we did it.
1. Believe You Can.
I’m not blowing sunshine at you, I genuinely believe this. I almost wrote “pray” down but in full academic honesty, there’s probably an atheist who at some time in history bought a house with cash.
Here’s my point though. If you are really going to do it, you should believe you can. For Sarah and I that meant earnestly praying about it. If you don’t believe that this is worth praying about you will be talked out of it by the first well meaning person offering free advice.
We talked with a financial advisor. They helped us learn how much we had to save a month. They helped set up an account using stable mutual funds and some bonds. We knew that if we kept investing, every month, we could ride the market for about 4 years before our investment strategy needed to change. (By the way if the idea of asking good questions and finding professional help makes you nervous check out this post)
You’ve got the big plan now break it into chunks. This was the nitty gritty side. Without the big number growing to keep us inspired we couldn’t have done this. We asked what do we need to do today, to win this week, to save to that number. That meant sitting down each month and putting a name on ever dollar. (This doesn’t get easier, in full transparency, this is the part that we want to continue to get better on)
4. Stack the deck
Even though budgeting is hard it doesn’t mean you can’t do things to stack the deck in your favor. We would leave early sometimes so we weren’t asked to go out to eat after events- because the budget said no. We literally froze our debit cards (like in a cup, in the freezer-literally) so we had to pay with cash. We had automatic withdrawals on our checking going into that mutual fund savings account we set up. Stacked on purpose and in our favor to help us stick to the plan.
5. Tell a few
Some of the people we were closest with had no idea what we were planning. Why? Because even the best of intentioned people will tell you well meaning facts that are actually dream killers in disguise as advice. Find someone that knows you are serious, encourages you to work hard, and fuels your dream.
6. Don’t bust down doors.
I did due diligence and found a cheap place to rent before I got married. Then it fell out from underneath me at the last minute (you get what you pay for someone might say). That same day, at random (remember how I said we prayed about this?) someone called with a better rental, in a house not apartment, offering it at the apartment price. That offer let us save and be safe.
Even in the actual sale of our house by being patient they ended up accepting $6,000 less than we originally offered. If you are praying and if you are patient that door will open.
7. Don’t be picky.
We didn’t bust down the door but when the carpet needed ripped out, the bathroom and kitchen gutted, and grade work needed done, we took it all. Good and bad. Why? Because to say yes to “no mortgage” we had to say no to a lot of conveniences. Including a kitchen for an entire year (that’s another fun story).
This is how we did it, it might not be the same for you. I also want to keep in mind that finances tend to be a touchy subject. And you may have misread the title of this post as “How you shouldn’t have bought a house with a mortgage.”
That’s not the title.
If you used a mortgage that’s completely fine. I don’t know your story and can’t speak into the choices you made. But I do know my story. And so many times as we saved for our goal we looked for someone who would help us by confirming- “yes it will be hard, but no it’s not impossible”. I hope that is what this post is for you. If your resolution was a big dream of paying off or buying a house with cash- don’t let that resolution die in February. Pray about it. Plan for it. Budget hard. Set yourself up for success. Find support/accountability. And be patient not picky.